Sustainable Growth Rate: Evidence from Agricultural and Food Enterprises

Mirela Momčilović; Sanja Vlaović Begović; Stevan Tomašević; Dajana Ercegovac

doi:10.7595/management.fon.2015.0017

Mirela Momčilović Higher School of Professional Business Studies, Novi Sad
Sanja Vlaović Begović Higher School of Professional Business Studies, Novi Sad
Stevan Tomašević Higher School of Professional Business Studies, Novi Sad
Dajana Ercegovac Higher School of Professional Business Studies, Novi Sad

DOI: https://doi.org/10.7595/management.fon.2015.0017

Abstract

Sustainable growth rate is a maximum growth rate that one enterprise may achieve with a given set of financial policies. The growth of an enterprise per rate higher than sustainable growth rate may lead to financial troubles, insolvency, even to the enterprise bankruptcy. In order to be able to finance a rapid growth, the enterprise will have to issue new shares, increase indebtedness, change its dividend policy, increase production efficiency or improve the asset turnover ratio. The enterprise growth per rate lower than sustainable may lead to a stagnation of the enterprise. The main goal of this paper is to show a sustainable growth rate calculation methodology and to apply this methodology in the determination of a sustainable growth rate in 2011 and 2012 for 60 enterprises in Serbia belonging to the agricultural and food sectors. Likewise, this paper is concerned with the comparison of the enterprise sustainable growth rate per stated sectors, the determination of existence of possible differences in their height in 2012 in relation to 2011 and with an overview of inflation effect on sustainable growth rate perselected sectors. All this is done in order to assess sustainable growth of agricultural and food sectors in the years under consideration. Research results indicate that possibilities for the sustainable growth were scarce or there was no real sustainable growth in agricultural and food sectors in 2011 and 2012.

Author Biographies

Mirela Momčilović, Higher School of Professional Business Studies, Novi Sad

Mirela S. Momcilovic received her B.Sc. at the Faculty of Economics, University of Novi Sad, Serbia in 2000. In 2004 she obtained a MBA at the Graduate School of Business from the Central European University in Budapest, Hungary. She is currently in the process of gaining a Ph.D. degree at the Faculty of Economics, University of Kragujevac, Serbia. From 2007 she works as an assistant professor at the Department of Finance, the Higher School of Professional Business Studies in Novi Sad, where she teaches several financial courses. As author or coauthor, she published more than 20 papers in national and international conferences and journals. Her basic scientific and professional interest includes teaching and research in the area of financial management and capital markets.

Sanja Vlaović Begović, Higher School of Professional Business Studies, Novi Sad

Sanja Vlaović Begović graduated at the Faculty of Economics in Subotica, University of Novi Sad, Serbia in 2005, where she also completed her master studies in 2012. She proceeded to doctoral studies at the Faculty of Economics in Niš. From 2007 she works at the Higher School of Professional Business Studies in Novi Sad, where she was elected a lecturer in 2012. From September 2013 she was promoted to the position of assistant of director for marketing and publishing activities. As author or coauthor, she published more than 20 papers in scientific journals and national and international conferences. Her basic scientific and professional interests include teaching and research in the area of financial analysis and evaluation of companies.

Stevan Tomašević, Higher School of Professional Business Studies, Novi Sad

Stevan Tomašević holds a M.Sc. degree from the Faculty of Economics, University of Novi Sad. He is a Ph. D. student at the Singidunum University. From 2007 he works as an assistant professor at the Department of Finance at the Higher School of Professional Business Studies in Novi Sad. As author or coauthor, he published more than 20 papers in scientific journals and national and international conferences. He is the manager of the scientific magazine School of Business. The fields of his scientific and professional interests are related to accounting and auditing.

Dajana Ercegovac, Higher School of Professional Business Studies, Novi Sad

Dajana Ercegovac graduated at the Faculty of Economics in Subotica, University of Novi Sad, Serbia in 2007 with a degree in financial management and accounting. In 2010 she finished her master’s degree in finance, banking and insurance at the Faculty of Economics in Subotica. She is currently on her third year ofn doctoral studies in the area of finance - financial markets and exchanges at the Faculty of Economics in Subotica. From 2007 she works as an assistant professor at the Higher School of Professional Business Studies in Novi Sad, where she teaches the following courses: banking, financial markets and exchanges, accounting, national economy, etc. As author or coauthor, she published more than 20 papers in national and international conferences and journals and her research area is Finance.